Jeb Hensarling wants to limit Republican defections

House Financial Services Chairman Jeb Hensarling successfully ushered his plan to overhaul the mortgage financing market through his panel last week. But a critical task lies ahead: minimizing the number of GOP defections when the legislation hits the House floor later this year.

Hensarling’s legislation has virtually no chance of being considered by the Democratic-controlled Senate in its current form, but to solidly establish it as the Republican Party’s negotiating position in future talks with the Obama administration and congressional Democrats, it will be crucial for Hensarling to contain the “no” votes in the House Republican Conference when the bill reaches the floor.

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The Texas Republican, who took over as chairman this year, has already had a taste of the potential obstacles he may face in the next few months as he tries to persuade his Republican colleagues to support a proposal that has received criticism from the housing industry — and some members of his own party.

The committee approved his bill on Wednesday in a mostly party-line vote, 30 to 27, but Republican Reps. Gary Miller of California and Mike Fitzpatrick of Pennsylvania voted against the proposal.

“There’s a lot of other members who have concerns. You’re going to find out that it’s not just a couple of us. A lot of members have concerns,” Miller said in an interview. “These issues I’ve talked about have to be addressed before it hits the floor. If they’re not before it hits the floor, I think the bill could have serious problems.”

The bill would get rid of taxpayer-owned mortgage finance companies Fannie Mae and Freddie Mac and greatly reduce the government’s role in the housing market.

One of the major concerns raised about the proposal by opponents is whether the U.S. housing market can survive the economic booms and busts if there isn’t an explicit government guarantee for the mortgage bonds and securities that provide much of the funding used to make home loans.

Hensarling has touted his plan as a way to end government bailouts and let the market decide who is best able to afford a mortgage rather than policymakers in Washington.

The chairman shrugged off Miller and Fitzpatrick’s “no” votes as lawmakers simply having “strong opinions,”saying that “from time to time, I have very strong views about matters, as well.”

Still, Hensarling is wasting little time in trying to rally support among his colleagues. He plans to appear before the Republican Conference this week to discuss the merits of the bill and said he will hold “listening sessions” with members.

And he may have plenty of time to make his case.

A spokeswoman for House Majority Leader Eric Cantor (R-Va.) said he is “committed to bringing housing finance reform to the floor” and that leadership will develop a plan to do so after Hensarling discusses the bill with colleagues “over the next few months.”